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Trading statement and operational update
QUANTUM FOODS HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 2013/208598/06)
Share code: QFH
ISIN: ZAE000193686
("Quantum Foods" or the "Company" or the "Group")
TRADING STATEMENT AND OPERATIONAL UPDATE
TRADING STATEMENT
In terms of the JSE Limited Listings Requirements, a listed company is required to publish a trading statement as soon
as it is satisfied that a reasonable degree of certainty exists that the financial results for the period to be reported on
next will differ by at least 20% from the most recent financial results for the previous corresponding period.
Shareholders of Quantum Foods are hereby advised that for the year ended 30 September 2025 ("FY2025" or the
"Current Reporting Period"), a reasonable degree of certainty exists that:
• headline earnings per share ("HEPS") of the Company will be between 127.4 cents and 143.4 cents compared to
the HEPS of 80.4 cents reported for the year ended 30 September 2024 ("Previous Corresponding Period"), being
an increase of between 58% and 78%; and
• earnings per share ("EPS") of the Company will be between 129.9 cents and 145.9 cents compared to the EPS of
80.0 cents reported for the Previous Corresponding Period, being an increase of between 62% and 82%.
OPERATIONAL UPDATE
Trading conditions during the Current Reporting Period showed marked improvement relative to the
Previous Corresponding Period.
During the Previous Corresponding Period, the Company experienced further outbreaks of highly pathogenic avian
influenza ("HPAI") in South Africa, impacting birds to the value of approximately R37 million. The HPAI outbreaks in
2023 and 2024 negatively affected earnings in the Previous Corresponding Period and resulted in reduced volumes of
feed, livestock, hatching eggs and table eggs. In addition, the Company incurred significant cleaning and disinfecting
costs in preparation of the affected farms for future placement. The negative impact was compounded by a substantial
number of load shedding hours in the first six months of the Previous Corresponding Period.
During the Current Reporting Period, the Company benefitted from improved throughput as a result of a recovery in its
layer flock, increased feed sales volumes, increased day-old broiler and layer livestock sales, strong operational
efficiencies, minimal load shedding in South Africa and improved performance from operations in Zambia and Uganda.
Although average egg selling prices remained relatively high, they decreased by approximately 17% compared to the
Previous Corresponding Period. This decline followed a recovery of the South African layer flock to levels above those
observed in mid-2023, prior to the major HPAI outbreaks of 2023 and 2024.
Feed costs for the Current Reporting Period were relatively stable when compared to the Previous Corresponding
Period.
During the Current Reporting Period:
• the average price of yellow maize on the South African Futures Exchange increased by 14% when compared to the
Previous Corresponding Period. This increase was driven by a lower South African crop yield for the 2024 harvest
season and resulted in the Company having to utilise imported maize at its coastal mills in order to lower costs;
whilst
• the average landed price of soya meal (at Cape Town harbour) decreased by 18%, primarily as a result of a
significant reduction in international soya meal prices, coupled with a 2% strengthening of the average South African
rand to United States dollar exchange rate, when compared to the Previous Corresponding Period.
The weighted average cost of broiler feed decreased by 2% when compared to the Previous Corresponding Period,
while the cost of layer feed remained unchanged.
Eggs
The Company's egg supply was approximately 79% higher in the Current Reporting Period when compared to the
Previous Corresponding Period. This increase enabled the Company to resume operations at the Pinetown egg packing
station, which had been mothballed during the Previous Corresponding Period due to restricted egg supply.
The positive margin contribution from higher egg volumes, strong operational efficiency at the egg packing stations,
effective cost management and improved overhead cost recovery was, however, outweighed by the negative impact of
the decline in average egg selling prices, resulting in a reduction in earnings from the egg business when compared to
the Previous Corresponding Period.
Farming
Layer farming
The Company continued to rebuild its layer flock during the first half of the Current Reporting Period, supported by
improved availability of replacement birds as the layer breeding and layer rearing facilities recovered from the 2023 and
2024 HPAI outbreaks. The higher volumes resulting from higher layer flock numbers contributed to improved farming
efficiencies and better cost recovery. The Company also benefitted from strong demand from external layer livestock
customers during the first half of the Current Reporting Period.
These factors resulted in much improved earnings from the layer farming business compared to the Previous
Corresponding Period, despite being partially offset by:
• Muted layer livestock demand during the second half of the Current Reporting Period, with some customers
cancelling or postponing orders following the reduction in egg selling prices and the risk of layer hen placement,
given the sporadic outbreaks of HPAI in various provinces of South Africa. This resulted in an imbalance in hatching
egg supply and day-old chick demand, as well as point of lay hens remaining on the Company's rearing farms
beyond the planned transfer age, further resulting in weaker efficiency and cost under recovery that negatively
impacted earnings from the layer livestock business.
• An outbreak of HPAI at a Western Cape layer farm in September 2025 which resulted in approximately 153 000
hens, with a value of c. R8.2 million, being destroyed. As at the date of this announcement, the Company has not
experienced any further outbreaks of HPAI on any of its farms.
• An administrative penalty of R10 million levied in September 2025, following a Section 24G rectification application
in terms of the National Environmental Management Act, No. 107 of 1998. The aforementioned rectification
application was lodged by the Company in respect of the Eggland poultry farm located in the Eastern Cape.
The rectification was initiated to ensure the environmental compliance of two poultry houses erected by a previous
owner without the prerequisite environmental approval. Quantum Foods acquired the farm in 2009, and the two
poultry houses were constructed approximately five years earlier. An appeal has been lodged and the Company is
awaiting the outcome thereof.
Broiler farming
The operational and financial performance of the broiler farming business during the Current Reporting Period was
excellent. The genetic performance of the Ross 308 birds improved further at both breeder and broiler level, supported
by effective cost management.
Day-old broiler chick volumes produced at the Hartbeespoort hatchery increased and benefitted from full production
activities at the Hartbeespoort breeder farm, which operated at full capacity during the Current Reporting Period. In the
Previous Corresponding Period, the Hartbeespoort breeder farm was only in production during the second half of the
period following recovery from an earlier HPAI outbreak.
The conversion of the Eigendom broiler farm and Esperanza layer rearing farm to broiler breeder farms, which was
completed during the Current Reporting Period, came into production during the second half of FY2025 and further
supported increased sales volumes from the Hartbeespoort hatchery. These farm conversions increased hatching egg
production volumes in the vicinity of the Hartbeespoort hatchery and, therefore, reduced the number of hatching eggs
required to be transferred to this facility from the Western Cape. This resulted in reduced logistical costs and improved
efficiencies, especially hatchability, which was negatively impacted by the previous long-distance transfer process.
Total day-old chick production increased by approximately 6% when compared to the Previous Corresponding Period,
while live broiler volumes remained consistent.
Overhead costs remained under control, contributing to the excellent performance of the broiler farming business for the
Current Reporting Period.
Feed business
The feed business delivered very good operational and financial performance during the Current Reporting Period,
supported by a recovery of volumes, particularly from the Pretoria feed mill, where both volumes supplied to the external
market and the Company's own farming operations were lower in the Previous Corresponding Period due to the 2023
and 2024 HPAI outbreaks. Total feed volumes supplied increased by approximately 9% compared to the
Previous Corresponding Period. The benefit of improved volumes and well-executed cost and margin management
offset the increased costs incurred in the first half of the Current Reporting Period with respect to the intake of raw
materials at the Malmesbury feed mill. Repairs to the Malmesbury feed mill intake area, which was damaged during the
explosion on 10 June 2024, were completed during December 2024.
The production capacity expansion project at the Malmesbury feed mill is progressing well and remains on track, with
production scheduled to commence in the second quarter of the financial year ending 30 September 2026.
Other African operations
Zambia
Trading conditions in Zambia remained challenging for most of the Current Reporting Period as the impact of earlier
drought conditions continued. During this period, higher feed raw material costs were experienced as a result of the
lower 2024 grain harvest and increased load shedding hours due to lower hydroelectric generation capacity. The 2025
grain harvest was much improved, which resulted in lower feed raw material costs during the latter part of FY2025.
While the demand for eggs remained strong and the Mega eggs business continued to perform well throughout the
Current Reporting Period, the demand for day-old chicks and feed remained muted for most of FY2025. This demand
recovered in the second half of FY2025, benefitting from lower feed costs and improved availability of electricity leading
to increased sales of day-old chicks and feed.
Layer farming and Ross 308 breeder efficiencies improved when compared to the Previous Corresponding Period,
contributing positively to earnings.
Uganda
Trading conditions in Uganda remained favourable during the Current Reporting Period. Feed cost remained relatively
low, although slightly higher than the Previous Corresponding Period, supporting the demand for day-old chicks and
margins from the Masindi Egg business. Broiler breeder and layer farming efficiencies improved substantially, thereby
contributing positively to improved earnings during the Current Reporting Period.
Mozambique
Trading conditions were challenging throughout the Current Reporting Period. Civil unrest following the October 2024
elections negatively impacted operations, including an incident on 26 December 2024 when a crowd forcibly entered
the layer farm and looted approximately 16% of the layer birds and some equipment. Fortunately, no injuries to staff
members were reported, and operations were able to resume soon after the incident. However, the hens looted and
resultant lower egg production, further impacted by a disruption in planned vaccinations, contributed to lower earnings
from this business. In addition, egg selling prices were lower following increased egg supply as the South African layer
flock recovered.
Overall, the Group's other African operations performed and contributed satisfactorily to the Company's financial
performance for the Current Reporting Period.
The financial information contained in this announcement is the responsibility of the directors of Quantum Foods and
such information has not been reviewed or reported on by the Company's external auditors.
The financial results for the Current Reporting Period are expected to be published on SENS on or about
Friday, 28 November 2025.
Wellington
24 October 2025
Corporate advisor and Sponsor
One Capital
Attorneys
Webber Wentzel
Date: 24-10-2025 03:05:00
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